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Some developers are exploiting legal loopholes by "hoarding" planning permissions without actually building anything, the former Environment Minister has warned.
Deputy Jonathan Renouf said he was concerned about situations where developers declined to act on their planning permission until they can make more money from the resulting build – or had used planning permission to simply inflate the value of the land they hold.
Speaking in the States Assembly this week, Deputy Jonathan Renouf called for a probe into the issue of stalled planning developments and urged the current Environment Minister to "make clear that this type of hoarding is not acceptable".
However, while the former Minister suggested that enforcing strict time limits could help spur development and address housing shortages, the current Environment Minister stressed the need for flexibility and warned against heavy-handed market intervention.
Pictured: Environment Minister Steve Luce stressed the need for flexibility and warned against heavy-handed market intervention.
Deputy Steve Luce also said that developers must have the opportunity to pause projects when economic conditions change.
"Interest rates, economic downturn, population demands on housing, and the price of building can all have an impact, and I would need to be very careful about interfering in the market," he said.
The core of the issue centres on Article 26 of the Planning and Building Law 2002.
Pictured: Former Environment Minister Jonathan Renouf said that some developers are "hoarding" planning permissions without actually building anything.
Deputy Renouf questioned whether the Minister would use this article to revoke permissions for developments that have not progressed.
In response, Deputy Luce clarified that only the Chief Officer or Planning Committee can serve notices on permissions with specific time conditions.
However, Deputy Renouf pointed out that some developers carry out minimal work solely to meet the "commencement" requirement – which effectively allows them to secure planning permission indefinitely.
Elaborating on his concerns, the former Minister told Express: "Typically you get given planning permission which has a standard condition that work must be commenced within three years.
"If you do not commence work within three years, you risk losing planning permission, subject to a few exceptions.
"But, if you commence work within three years the three-year time limit no longer applies. You effectively have permission in perpetuity.
"Some developers can use this as a loophole to ensure they don’t lose planning permission even when they have no intention to build within three years.
"They undertake a small piece of work and then stop and the effect is that they have planning permission forever."
He continued: "Sometimes planning permission is used to increase the value of a property or of land.
"Sometimes it's a stepping stone to another application which can build on the one that has been given, and that opportunity falls away if the original permit is withdrawn."
He acknowledged that there may be "problems in defining the circumstances in which planning permission could be withdrawn", but added: "My call is simply for it to be explored properly.
"Otherwise, in approving planning applications we're filling up the reservoir but we have no means to require the taps to be turned on."
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